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If Item 12 and 13 has been removed from the contract but Working area overhead percentage remains along with a people overhead percentage how do I apply this to my costs? The client is suggesting that accommodation/travel/mileage etc is a disallowed cost?

Can I apply both percentages to my costs once all the listed items under Items 12 and 13 have been removed?

1 Answer

The removal of items 12 and 13 in the SCC doesn't actually simplify the assessment, as item 11 states, ' ... wages, salaries and amounts paid by the Contractor ..... '.

Items 12 and 13 provided definition of what was and wasn't included in the 'amounts paid', so by deleting these you don't 'disallow' such costs you just don't define what is 'allowable'.

A people overhead percentage is not an ECC Main Option C standard application so I assume this has been added to replace items 12 and 13. That may be the intention, however, although if the contract is not clearly worded then your guess is as good as mine !!